Dipeptidyl carboxypeptidase (DCP), an enzyme involved in the turnover of a number of biologically active peptides such as angiotensin, bradykinin and the enkephalins, was heterogeneously distributed in rat brain. The corpus striatum was especially enriched in enzyme activity, which was associated with membranes in synaptosomal and myelin-enriched fractions. Removal of inhibitory factors by dialysis or Sephadex G25 chromatography greatly enhanced DCP activity in crude striatal preparations. The presence of an inhibitor was further confirmed by titration studies of the heat-stable cytosolic factor against standard striatal particulate preparations. Turnover of the heat-stable cytosolic inhibitor could be controlled by membrane-associated factors, which may include DCP and other membrane components. The level of inhibitor in ten brain regions was similar, suggesting that differences in specific activity of DCP among brain regions were due to factors other than inhibitor. Osmolality of the incubation mixture and the presence of distinct ions greatly affected the activity of DCP. Striatal DCP appeared to be immunologically homologous to pulmonary DCP. Studies are presently being conducted with both crude and purified preparations of the enzyme to determine factors that may control both catalytic activity and molecular stability of DCP.